Economy
Approval effect on US tariffs: industrial orders grow strongly
German industry is unexpectedly received many orders. Because companies prefer orders for Trump’s tariffs. But demand is also growing from Europe – a ray of hope for the economy?
The weakening German industry was surprisingly received in March – probably because of the aggressive customs policy of US President Donald Trump. In March, orders attracted 3.6 percent measured on the previous month, as the Federal Statistical Office in Wiesbaden announced. The increase is almost three times as expected from analysts – they only expected an increase of 1.3 percent.
“The Orderplus in March should be due to advanced effects in response to the announced US volumes,” said the Federal Ministry of Economics. However, the demand from the European neighbors also attracted a lot. Despite the great trade policy uncertainty, the business situation of the industry had proven to be “quite robust” in the first quarter.
More orders in car and mechanical engineering
According to the statistics, orders in March primarily increased from a strong demand abroad (plus 4.7 percent), in particular from the euro zone, and orders in Germany grew by 2.0 percent. German key sectors such as car and mechanical engineering got significantly more orders. The orders even jumped up high for the manufacturers of electrical equipment (plus 14.5 percent) and in the pharmaceutical industry (plus 17.3 percent).
The industrial orders had still stagnated in February, and they had dropped significantly in January. The weakness of the industry is one of the main reasons for the German economy to be in a doldrum for the third year in a row.
“Companies strongly unsettled by Zollschock”
Economists evaluated the numbers positively. “This is finally a strong plus for the order inputs, which is not only due to the major orders that are prone to fluctuations,” said Commerzbank chief economist Jörg Krämer. However, one should not expect a strong upswing. “Trump’s customs shock has greatly unsettled the companies. In addition, the urgently needed restart in economic policy has become even more unlikely due to the narrow majority of the new federal government.”
Michael Herzum, Head of Economics at the Fund provider Union Investment, was skeptical: “A swallow does not make a summer yet.” At first glance, the industry of high customs uncertainty defied. At second glance, however, the recovery is unfortunately “nothing more than a straw fire”. The unpredictable US economic policy will continue to burden.
dpa
Source: Stern
